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MAY 3, 1999
PROSPECTUS
A family of mutual funds that aims to give investors
the tools to build prudent investment portfolios
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Burnham Dow 30 Focused Fund
Burnham Fund
BURNHAM INVESTORS TRUST
Burnham Financial Services Fund
Burnham Money Market Fund
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As with all mutual funds, the
Securities and Exchange
Commission does not approve
or disapprove these shares or
say whether the information in
this prospectus is truthful or
complete. It is a criminal offense
for anyone to inform you
otherwise.
[BURNHAM INVESTORS TRUST LOGO]
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Each of the Burnham funds has its
own risk profile, so be sure to read this
prospectus carefully before investing in
any of the funds.
Mutual funds are not bank accounts and
are neither insured nor guaranteed by
the FDIC or any other government agency.
An investment in any mutual fund entails
the risk of losing money.
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[LOGO] INTRODUCING
THE BURNHAM FUNDS
TABLE OF CONTENTS
<TABLE>
<S> <C> <C>
I THE FUNDS....................................................2
Profiles of the principal strategies and risks of each fund
BURNHAM DOW 30 FOCUSED FUND..................................2
BURNHAM FUND.................................................6
BURNHAM FINANCIAL SERVICES FUND.............................10
BURNHAM MONEY MARKET FUND...................................14
THE INVESTMENT ADVISER......................................18
II YOUR ACCOUNT................................................19
Instructions and information on investing in the funds
PURCHASE AND REDEMPTION
FLOW CHART..................................................20
CHOOSING A SHARE CLASS......................................21
HOW TO BUY SHARES...........................................23
HOW TO EXCHANGE AND REDEEM SHARES...........................24
TRANSACTION POLICIES........................................25
TAX CONSIDERATIONS AND DISTRIBUTIONS........................27
DOW JONES DISCLAIMER........................................28
III FINANCIAL HIGHLIGHTS........................................29
Fund performance data
WHERE TO GET MORE INFORMATION
....................................................BACK COVER
</TABLE>
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BURNHAM
DOW 30'sm' FOCUSED
FUND
IS THIS FUND FOR YOU?
Burnham Dow 30 Focused Fund
is best suited to investors who:
Are investing for the
long term
Seek capital appreciation from
a portfolio of DJIA stocks
Want to increase their
exposure to the largest U.S.
companies
Are comfortable with price
volatility
[LOGO]
PORTFOLIO MANAGER
David Leibowitz has the primary
day-to-day responsibility for the
fund's portfolio since its inception.
Mr. Leibowitz is a Managing
Director of Burnham Asset
Management Corp.
This fund's goal is non-fundamental
and may be changed without share-
holder approval.
[LOGO] GOAL AND MAIN STRATEGIES
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THE FUND'S GOAL IS CAPITAL APPRECIATION.
The fund pursues its goal by investing in stocks represented in the Dow Jones
Industrial Average'sm' (DJIA'sm'). The fund also invests in closely related
securities, called DJIA equivalents, including:
Securities such as DIAMONDS'sm', which represent percentage
interests in a basket of all 30 DJIA stocks.
Derivatives that are based on U.S. stock indices or on individual
DJIA stocks. Derivatives are a type of investment whose value is
determined by underlying securities or market indices.
HOW THE FUND SELECTS SECURITIES
The fund invests approximately half of its assets passively and half actively.
Both halves may invest in in DJIA stocks or DJIA equivalents; the passive half
invests in these in proportions that approximately match the composition of the
DJIA.
In managing the active portion of its assets, the fund may continue to hold
stocks that have been dropped from the DJIA. The fund may also emphasize or
overweight certain DJIA companies that appear to have the following
characteristics:
Low price-to-earnings (P/E) ratios
Attractive cash flows
Higher actual and projected dividends
Above-average growth rates relative to P/E ratios
Perceived momentum in earnings growth
WHAT ARE DIAMONDS?
DIAMONDS are shares of a publicly traded
unit investment trust that owns the stocks
of the DJIA in the same proportion as
represented in the DJIA. DIAMONDS trade on
the American Stock Exchange at approximately
99/100th of the value of the DJIA. DIAMONDS
have certain operational expenses that are
deducted from the dividends paid to DIAMOND
investors.
2 THE FUNDS
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In both parts of the portfolio, the fund may invest in DJIA equivalents rather
than DJIA stocks in order to:
Maintain liquidity
Facilitate trading
Reduce transaction costs
Take advantage of relative bargains
Under normal conditions, the fund intends to remain fully invested. In
extraordinary circumstances, the fund may invest up to 25% of assets in cash or
cash equivalents. In such circumstances, the fund would be assuming a temporary
defensive position and would not be pursuing its goal.
[LOGO] MAIN RISKS
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The main risk of this fund is a downturn in the stock market, and particularly
in the Dow Jones Industrial Average.
Any of the following situations could cause the fund to lose money or
underperform in comparison with its peer group:
Blue-chip stocks could fall out of favor with the market, especially
in relation to small-capitalization stocks.
DJIA companies in the fund's portfolio could fail to achieve
earnings estimates or other market expectations, causing their stock
prices to drop. If the fund overweights its investment in any such
company, it could suffer disproportionately higher losses.
DJIA equivalents could underperform DJIA stocks because of
weak price correlation.
The fund's management strategy, or other stock selection methods,
could prove to be less successful than anticipated.
Investments in derivatives could magnify any of the fund's gains
or losses.
NON-DIVERSIFICATION
The fund is non-diversified and may invest a
larger portion of its assets in the
securities of a single issuer than
diversified funds. An investment in the fund
could go up and down in value more than an
investment in a diversified fund.
DOW JONES INDUSTRIAL AVERAGE
The Dow Jones Industrial Average is
the oldest continuing stock market
average in the world. The companies
in it are household names and repre-
sent about one-sixth of the market
value of the U.S. stock market. Unlike
a market index, the DJIA is weighted
by share price rather than market
capitalization. Each day, the prices of
one share of each company in the
average are totaled. Then, instead of
simply dividing by 30 to get an aver-
age, the total is multiplied by a special
divisor calculated to compensate for
stock splits and similar events that
would otherwise distort the average.
The composition of the DJIA
changes from time to time, as deter-
mined by the editors of The Wall
Street Journal. Dow Jones & Company,
Inc. has no connections with or
obligations to the adviser or the fund.
Dow Jones does not sponsor, endorse,
sell or promote the fund. Dow Jones
does not make any representation
regarding the advisability of investing
in the fund.
THE FUNDS 3
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[LOGO] PAST PERFORMANCE
No past performance data is available yet for this new fund. Next year's
prospectus will provide the information here.
4 THE FUNDS
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[LOGO] FEES AND EXPENSES
The table below describes the fees and expenses you could expect as an investor
in this fund. SHAREHOLDER FEES are one-time expenses charged directly to you.
ANNUAL FUND OPERATING EXPENSES come out of fund assets, and are reflected in the
fund's total return.
FEE TABLE
<TABLE>
<S> <C>
SHAREHOLDER FEES
fees paid directly from your investment
Maximum redemption fee 1.00%
charged only on shares you sell after
owning them for less than six months
ANNUAL FUND OPERATING EXPENSES
expenses that are deducted from fund assets
Management fees 0.60%
Distribution (12b-1) fees 0.25%
Other expenses(1),(2) 0.97%
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TOTAL ANNUAL FUND OPERATING EXPENSES(1) 1.82%
</TABLE>
(1) The adviser has agreed to cap the annual fund operating expenses, although
it may change or drop the cap at any time. With the cap, actual expenses are
projected to be:
<TABLE>
<S> <C>
Management fees 0.60%
Distribution (12b-1) fees 0.25%
Other expenses 0.35%
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Net annual fund operating expenses 1.20%
</TABLE>
(2) Based on estimated amounts for the current fiscal year.
EXAMPLE
This example shows what you could pay in expenses over time. To help you compare
this fund's expenses with those of other funds, the example uses the same
hypothetical assumptions as other mutual fund prospectuses:
$10,000 original investment
5% annual return
No changes in operating expenses
Reinvestment of all dividends and distributions
1 year 3 years
-------------------------
$ 185 $ 573
The figures in the example would be the same whether you sold your shares at the
end of the period or kept them. Because actual return and expenses may be
different, this example is for comparison purposes only.
UNDERSTANDING
SHAREHOLDER FEES
REDEMPTION FEES
Fees used to discourage short-term
market timers from engaging in
frequent purchases and redemp-
tions. This practice can disrupt the
fund's investment program and
result in additional transaction costs
that are borne by all shareholders
of the fund. (The fund is intended
for investors with a long-term
investment outlook.)
UNDERSTANDING FUND
EXPENSES
MANAGEMENT FEES
Fees paid to the adviser for the
supervision of the fund's invest-
ment program.
RULE 12b-1 FEES
Under SEC Rule 12b-1, mutual
funds may use some of their
assets to pay commissions to
brokers, other marketing expenses
and shareholder service fees.
You should take 12b-1 fees into
account when choosing a fund
and share class.
OTHER EXPENSES
Fees paid by the fund for mis-
cellaneous items such as transfer
agency, custodian, professional
and registration fees.
THE FUNDS 5
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TICKER SYMBOL:
BURHX
IS THIS FUND FOR YOU?
Burnham Fund is best suited to
investors who:
Want the relative stability of
investments in large-capital-
ization companies with some
of the growth opportunities
of smaller companies
Seek capital growth with
a focus on risk management
Are investing for the
long term
[LOGO]
PORTFOLIO MANAGER
Jon M. Burnham has had primary
day-to-day responsibility for
the fund's portfolio since 1995.
Mr. Burnham is president, chief
executive officer and a trustee
of the fund and the chairman
and chief executive officer
of the adviser and distributor.
BURNHAM FUND
[LOGO] GOAL AND MAIN STRATEGIES
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THE FUND SEEKS CAPITAL APPRECIATION, MAINLY LONG-TERM. INCOME IS GENERALLY OF
LESSER IMPORTANCE, MEANING THAT IT IS A SECONDARY GOAL.
The fund pursues its goal by investing in a diverse portfolio of common stocks.
The fund will invest predominately in large-capitalization companies.
HOW THE FUND SELECTS SECURITIES
In managing the fund's stock portfolio, the manager first uses sector research,
which focuses on selecting the industries the fund will invest in (top-down
research). The fund seeks to reduce risk by diversifying across many different
industries and economic sectors. In the past, the fund has tended to favor the
following sectors:
Consumer durables
Energy
Finance
Pharmaceuticals
Technology
The fund may emphasize different sectors in the future.
In selecting individual stocks, the manager looks for companies that appear to
have the following characteristics:
Potential for sustained earnings growth of at least 15%-20%
per year
Product leadership and strong management teams that focus on
enhancing shareholder value
Companies with histories of paying regular dividends
Securities that appear undervalued by the market or that seem
to be poised to benefit from restructuring or similar business
changes
Although the fund typically favors large "blue-chip"companies, it will consider
opportunities in medium- and small-capitalization companies that meet its
selection criteria.
6 THE FUNDS
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OTHER INVESTMENTS
The fund may also invest in debt securities of any maturity, duration or credit
rating (including junk bonds) from any government or corporate issuer. The fund
generally invests in short- to medium-term corporate bonds and maintains an
average portfolio credit rating of A.
The fund may invest without limit in dollar-denominated foreign securities but
only up to 15% of assets in non-dollar foreign securities. The fund may make
limited investments in derivative instruments. Derivatives are a type of
investment whose value is based on other securities or market indices.
Under normal conditions, the fund intends to remain fully invested. In
extraordinary conditions, the fund may invest extensively in cash or short-term
investment grade debt securities. In such circumstances, the fund would be
assuming a temporary defensive position and would not be pursuing its goal.
[LOGO] MAIN RISKS
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The main risk of this fund is a downturn in the stock market, and particularly
in stocks of large-capitalization companies. The fund's investments in debt
securities will generally fall in value when interest rates rise.
Any of the following situations could cause the fund to lose money or
underperform in comparison with its peer group:
Any of the categories of securities that the fund emphasizes--
large-capitalization stocks or particular sectors--could fall
out of favor with the market.
Companies in the fund's portfolio could fail to achieve
earnings estimates or other market expectations, causing their
stock prices to drop.
The fund's management strategy or securities selection methods
could prove less successful than anticipated.
A bond issuer could be downgraded in credit rating or go into
default. The risk of default and the price volatility
associated with it are greater for junk bonds.
If any of the fund's bonds are redeemed substantially earlier
or later than expected, performance could suffer.
Investments in derivatives could magnify any of the fund's
gains or losses.
Foreign investments present additional risks compared with
domestic investments. These may include:
Unfavorable currency exchange rates
Inadequate financial information
Political and economic upheavals
These risks are greater in emerging markets.
DEFINITION OF
LARGE-CAPITALIZATION STOCKS
Large-capitalization stocks
(commonly known as "blue-
chip") are usually issued by well
established companies. These
companies maintain a sound
financial base and offer a variety
of product lines and businesses.
As compared with smaller-
capitalization companies,
securities of large companies
historically have involved less
market risk and lower long-term
market returns. Their stock
prices tend to rise and fall less
dramatically than those of
smaller-capitalization companies.
This fund considers a stock to
be a large-capitalization stock if
its total market capitalization
(the value of all of its outstanding
shares) is $8.5 billion or more.
THE FUNDS 7
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[LOGO] PAST PERFORMANCE
The chart in this section illustrate the fund's historic pattern of returns and
price volatility from several perspectives. All mutual funds present this
information so that you can compare funds more readily. Bear in mind that past
performance is not a guarantee of future performance.
The bar chart shows the fund's annual total returns for the last ten years.
Returns for the fund's single best and single worst quarters give some
indication of how widely short-term performance has varied. These figures would
be lower if they reflected sales charges.
RETURN FOR CLASS A SHARES
[PERFORMANCE GRAPGH]
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1989 1990 1991 1992 1993 1994 1995 1996 1997 1998
22.75% (1.76%) 17.98% 7.70% 9.35% (1.77%) 24.45% 17.60% 24.74% 22.08%
</TABLE>
<TABLE>
<S> <C>
BEST QUARTER 21.07% IN 4TH QUARTER OF 1998
WORST QUARTER (13.36%) IN 3RD QUARTER OF 1998
</TABLE>
The table presents the fund's average annual returns over 1, 5 and 10 years for
each share class and the life of class for Class B shares along with those of
recognized U.S. common stock and bond indices.The fund's performance figures
assume that all distributions were reinvested in the fund. The performance
calculations reflect the deduction of the maximum sales charges and annual fund
operating expenses.
AVERAGE ANNUAL RETURNS
<TABLE>
<CAPTION>
Class B:
For the following periods ending 12/31/98 1 year 5 years 10 years inception*
<S> <C> <C> <C> <C>
CLASS A SHARES 15.98 15.77 13.30 --
CLASS B SHARES 17.16 16.07 -- 15.06
S & P 500 INDEX 28.58 24.05 19.20 00.00
LEHMAN GOV/CORP BOND INDEX 9.47 7.30 9.33 00.00
</TABLE>
The S&P 500 Index includes the common stocks of 500 large U.S. companies. The
Lehman Brothers Government/Corporate Bond Index includes U.S. government and
corporate bonds. Both are unmanaged.
*Class B shares commenced operations on 10/18/93; their performance is
compared to index figures that begin on 11/1/93.
8 THE FUNDS
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[LOGO] FEES AND EXPENSES
The table below describes the fees and expenses you could expect as an investor
in this fund. SHAREHOLDER FEES are one-time expenses charged directly to you.
ANNUAL FUND OPERATING EXPENSES come out of fund assets, and are reflected in the
fund's total return.
FEE TABLE
<TABLE>
<CAPTION>
Class A Class B
<S> <C> <C>
SHAREHOLDER FEES
fees paid directly from your investment
Maximum front-end sales charge (load) 5.00% NONE
% of offering price
Maximum contingent deferred sales charge NONE 5.00%
% of offering price or the amount you
receive when you sell shares, whichever is less
ANNUAL FUND OPERATING EXPENSES
expenses that are deducted from fund assets
Management fees 0.60% 0.60%
Distribution (12b-1) fees 0.25% 1.00%
Other expenses(1) 0.51% 0.81%
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TOTAL ANNUAL FUND OPERATING EXPENSES(1) 1.36% 2.41%
</TABLE>
(1)The adviser has agreed to cap the annual fund operating expenses, although it
may change or drop the cap at any time. With the cap, actual expenses are
projected to be:
<TABLE>
<S> <C> <C>
Management fees 0.60% 0.60%
Distribution (12b-1) fees 0.25% 1.00%
Other expenses 0.45% 0.70%
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Net Annual Fund Operating Expenses 1.30% 2.30%
</TABLE>
Example
This example shows what you could pay in expenses over time. To help you compare
this fund's expenses with those of other funds, the example uses the same
hypothetical assumptions as other mutual fund prospectuses:
$10,000 original investment
5% annual return
No changes in operating expenses
Reinvestment of all dividends and distributions
<TABLE>
<CAPTION>
1 year 3 year 5 year 10 year
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<S> <C> <C> <C> <C>
Class A $ 632 $ 909 $ 1,207 $ 2,053
Class B with redemption $ 644 $ 1,051 $ 1,385 $ 2,485
Class B without redemption $ 244 $ 751 $ 1,285 $ 2,485
</TABLE>
Because actual returns and expenses may be differenc, this example is for
comparison purposes only. The 10 year figures for Class B shares assume the
conversion for Class A shares after eight years.
UNDERSTANDING
SHAREHOLDER FEES
FRONT-END SALES CHARGE
An amount charged for the sale
of some fund shares, usually sold
by a broker or sales professional.
A sales charge or load is reflected
in the asked or offering price.
ASKED OR OFFERING PRICE
The price at which the fund's
shares may be purchased. The
asked or offering price includes
the current net asset value
plus any sales charge.
CONTINGENT DEFERRED SALES CHARGE
A fee imposed when shares
are redeemed during the first
few years of ownership. Please
refer to "Choosing a Share
Class" on page 21 for further
information on alternative
purchase arrangements.
UNDERSTANDING FUND
EXPENSES
MANAGEMENT FEES
Fee paid to the adviser for
the supervision of the fund's
investment program.
RULE 12b-1 FEES
Under SEC Rule 12b-1, mutual
funds may use some of their
assets to pay commissions to
brokers, other marketing expens-
es and shareholder service fees.
You should take 12b-1 fees into
account when choosing a fund
and share class.
OTHER EXPENSES
Fees paid by the fund for mis-
cellaneous items such as transfer
agency, custodian, professional
and registration fees.
THE FUNDS 9
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IS THIS FUND FOR YOU?
Burnham Financial Services Fund
is best suited to investors who:
Are investing for the
long term
Wish to increase their
exposure to the financial
services sector
Seek potentially more
rapid capital growth than
might be achieved in
a sector-diversified fund
Are comfortable with
increased price volatility
[LOGO]
SUBADVISER
Mendon Capital Advisors Corp.
is a registered investment adviser
incorporated in the State of
Delaware. The subadviser has been
providing investment advisory
services focused in the financial
services industry to private invest-
ment companies since 1996.
PORTFOLIO MANAGER
Anton Schutz has had the primary
day-to-day responsibility for the
fund's portfolio since its inception.
Mr. Schutz is the President of
Mendon Capital Advisors Corp.
and Vice President of Burnham
Securities Inc.
This fund's goal is non-fundamental
and may be changed without share-
holder approval.
BURNHAM
FINANCIAL SERVICES
FUND
[LOGO] GOAL AND MAIN STRATEGIES
THE FUND SEEKS CAPITAL APPRECIATION.
The fund pursues its goals by investing at least 75% of assets in stocks of U.S.
companies in the financial services sector. The fund considers all of the
following as part of this sector:
Banks and thrifts
Securities brokers and dealers
Investment management and advisory firms
Insurance companies
Specialty finance companies
Financial conglomerates
Publicly traded, government-sponsored financial intermediaries
Any company that derives at least 50% of its revenues from doing
business with financial services companies, such as a financial
software company
HOW THE FUND SELECTS SECURITIES
In selecting stocks, the fund's manager uses a combination of growth and value
strategies. The manager seeks growth stocks of companies with the following
characteristics:
Capable management
Attractive business niches
Sound financial and accounting practices
Demonstrated ability to sustain growth in revenues, earnings and
cash flow
The manager also looks for opportunities to purchase value stocks of companies
that appear to be:
Undervalued based on their balance sheets or individual circumstances
Temporarily distressed
Poised for a merger or acquisition
Although the fund may invest in companies of any size, it typically focuses on
those with market capitalization of $8 billion or less. The fund generally
intends to invest in U.S. companies, but it may also invest up to 10% of assets
in foreign securities.
This stock selection strategy may lead the fund to concentrate its investments
in a few regions of the U.S.
10 THE FUNDS
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OTHER INVESTMENTS
The fund may invest up to 25% of assets in:
Companies outside the financial services sector
Debt securities of any maturity, duration, or credit rating
(including junk bonds) from any government or corporate issuer, U.S.
or foreign
The fund may use derivatives (a type of investment whose value is based on other
securities or market indices) to hedge against market changes or as a substitute
for securities transactions. It may also use derivatives in attempts to profit
from anticipated market movements.
Under normal conditions, the fund intends to remain fully invested. In
extraordinary circumstances, the fund may invest extensively in cash or
short-term investment- grade debt securities. In such circumstances, the fund
would be assuming a temporary defensive position and would not be pursuing its
goal.
[LOGO] MAIN RISKS
The main risk of this fund is the performance of the stock market and the level
of interest rates. Because this fund concentrates its investments in one sector
of the economy, investors should expect greater volatility than in a fund that
invests across several sectors.
Any of the following situations could cause the fund to lose money or
underperform in comparison with its peer group:
An adverse event could disproportionately affect the financial
services sector.
Rising interest rates increase the cost of financing to, and reduce
the profitability of, companies in the financial services sector.
Any of the categories of securities that the fund emphasizes--
financial services companies and companies with less than $8 billion
in market capitalization--could fall out of favor.
Companies in the fund's portfolio could fail to achieve earnings
estimates or other market expectations, causing their stock prices
to drop.
Investments in derivatives could magnify any of the fund's gains or
losses.
A bond issuer could be downgraded in credit quality or go into
default. The risk of default and the price volatility associated with
it are greater for junk bonds.
Foreign investments present additional risks compared with domestic
investments. These may include:
Unfavorable currency exchange rates
Inadequate financial information
Political and economic upheavals
These risks are greater in emerging markets.
WHY INVEST IN FINANCIAL
COMPANIES?
DEMOGRAPHICS
The largest consumers of financial
services are those in the 45 to
64 age group, which is projected
to grow significantly over the next
20 years.
CONSOLIDATION
The current consolidation trend in
the financial services sector presents
investment opportunities.
DEREGULATION
Deregulation of the financial services
industry is enabling firms to enter
a wider variety of financial service
businesses.
GLOBALIZATION
Increasing globalization provides
opportunities for foreign firms
to expand their businesses in the
financial services sector.
SPECIALIZATION
Financial service providers are
"unbundling" financial products to
meet customer needs, provide profit
opportunities and expand their
markets.
THE FUNDS 11
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<PAGE>
[LOGO] PAST PERFORMANCE
No past performance data is available yet for this new fund. Next year's
prospectus will provide the information here.
12 THE FUNDS
<PAGE>
<PAGE>
[LOGO] FEES AND EXPENSES
The table below describes the fees and expenses you could expect as an investor
in this fund. SHAREHOLDER FEES are one-time expenses charged directly to you.
ANNUAL FUND OPERATING EXPENSES come out of fund assets, and are reflected in the
fund's total return.
FEE TABLE
<TABLE>
<CAPTION>
Class A Class B
<S> <C> <C>
SHAREHOLDER FEES
fees paid directly from your investment
Maximum front-end sales charge (load) 5.00% None
% of offering price
Maximum contingent deferred sales charge NONE 5.00%
% of offering price or the amount you receive
when you sell shares, whichever is less
ANNUAL FUND OPERATING EXPENSES
expenses that are deducted from fund assets
Management fees 0.75% 0.75%
Distribution (12b-1) fees 0.25% 1.00%
Other expenses(1),(2) 1.02% 2.27%
- --------------------------------------------------------------------------------
TOTAL ANNUAL FUND OPERATING EXPENSES(1) 2.02% 4.02%
</TABLE>
(1) The adviser has agreed to cap the annual fund operating expenses, although
it may change or drop the cap at any time. With the cap, actual expenses are
projected to be:
<TABLE>
<S> <C> <C>
Management fees 0.75% 0.75%
Distribution (12b-1) fees 0.25% 1.00%
Other expenses 0.60% 0.55%
- --------------------------------------------------------------------------------
Net Annual Fund Operating Expenses 1.60% 2.30%
</TABLE>
(2) Based on estimated amounts for the current fiscal year.
EXAMPLE
This example shows what you could pay in expenses over time. To help you compare
this fund's expenses with those of other funds, the example uses the same
hypothetical assumptions as other mutual fund prospectuses:
$10,000 original investment
5% annual return
No changes in operating expenses
Reinvestment of all dividends and distributions
<TABLE>
<CAPTION>
1 year 3 years
- --------------------------------------------------------------------------------
<S> <C> <C>
Class A $ 695 $ 1,102
Class B with redemption 804 1,524
Class B without redemption 404 1,223
</TABLE>
Because actual return and expenses may be different, this example is for
comparison purposes only.
UNDERSTANDING
SHAREHOLDER FEES
FRONT-END SALES CHARGE
An amount charged for the sale
of some fund shares, usually sold
by a broker or sales professional.
A sales charge or load is reflected
in the asked or offering price.
ASKED OR OFFERING PRICE
The price at which the fund's
shares may be purchased. The
asked or offering price includes
the current net asset value plus
any sales charge.
CONTINGENT DEFERRED SALES
CHARGE
A fee imposed when shares
are redeemed during the first
few years of ownership. Please
refer to "Choosing a Share
Class" on page 21 for further
information on alternative
purchase arrangements.
UNDERSTANDING FUND
EXPENSES
MANAGEMENT FEES
Fee paid to the adviser for
the supervision of the fund's
investment program.
RULE 12b-1 FEES
Under SEC Rule 12b-1,
mutual funds may use some of
their assets to pay commissions
to brokers, other marketing
expenses and shareholder service
fees. You should take 12b-1 fees
into account when choosing a
fund and share class.
OTHER EXPENSES
Fees paid by the fund for
miscellaneous items such as
transfer agency, custodian,
professional and registration fees.
THE FUNDS 13
<PAGE>
<PAGE>
IS THIS FUND FOR YOU?
Burnham Money Market Fund is
best suited to investors who:
Seek to preserve capital
Are seeking a temporary
holding place for investments
Are investing for the short term
Seeking the highest possible
income available from short-term
securities
[LOGO]
SUBADVISER
Reich & Tang Asset Management
L.P. was formed in 1994. Reich
& Tang manages discretionary
equity and money market assets,
principally for institutional clients.
The subadviser's investment
philosophy is oriented toward the
preservation of capital and long-
term appreciation.
This fund's goal is non-fundamental
and may be changed without shareholder
approval.
BURNHAM
MONEY MARKET
FUND
[LOGO] GOAL AND MAIN STRATEGIES
THE FUND'S GOAL IS MAXIMUM CURRENT INCOME THAT IS CONSISTENT WITH MAINTAINING
LIQUIDITY AND PRESERVING CAPITAL.
The fund is managed to maintain a stable $1.00 share price. The fund invests
only in dollar-denominated money market securities of the highest short-term
credit quality. Each security must have a remaining maturity of 13 months or
less. The fund's average weighted maturity will not exceed 90 days. Its yield
will go up and down with changes in short-term interest rates.
HOW THE FUND SELECTS SECURITIES
In managing the portfolio, the subadviser looks for securities that appear to
offer the best relative value based on analysis of:
Credit quality
Interest rate sensitivity
Yield
Price
An investment committee meets weekly to determine the fund's portfolio strategy
based on interest rates, credit quality and performance. The primary function of
the committee is to develop an approved list of securities that satisfy the
funds' credit criteria, guidelines and objectives. From time to time, the fund
may emphasize, or overweight, its investments in particular types of issuers or
maturities to increase current yields.
The fund may invest in certain foreign securities: dollar-denominated money
market securities of foreign issuers, foreign branches of U.S. banks, and U.S.
branches of foreign banks.
DEFINITION OF A MONEY MARKET FUND
A money market fund is a pool of assets
investing in U.S. dollar-denominated
short-term debt obligations. Because of
the high degree of safety they provide,
money market funds typically offer the
lowest return of any type of mutual
fund.
14 THE FUNDS
<PAGE>
<PAGE>
Money market fund yield
The fund's current yield reflects the
relationship between the fund's current
level of annual income and its price on
a particular day.
[LOGO] MAIN RISKS
- --------------------------------------------------------------------------------
The main risk of this fund is the level of short-term interest rates. If
short-term interest rates rise steeply, the prices of money market securities
could fall and threaten the $1.00 share price that the fund tries to maintain.
Any of the following situations could cause the fund to lose money or under
perform in comparison with its peer group:
An issuer could be downgraded in credit quality or go into default.
Foreign securities present additional risks compared with domestic
investments. these may include:
Inadequate financial information
Political and economic upheavals
An investment in the fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation (FDIC) or any other government agency. Although the fund
seeks to preserve the value of your investment at $1.00 per share, it is
possible to lose money by investing in the fund.
TYPES OF MONEY
MARKET SECURITIES
U.S. TREASURY BILLS
Debt obligations sold by the
U.S. Treasury that mature in
one year or less and are backed
by the U.S. government.
AGENCY NOTES
Debt obligations of U.S.
government agencies.
CERTIFICATES OF DEPOSIT
Receipts for funds deposited
at banks that guarantee a fixed
interest rate over a specified
time period.
REPURCHASE AGREEMENTS
Contracts, usually involving U.S.
government securities, whereby
one party sells and agrees to
buy back securities at a fixed price
on a designated date.
BANKERS' ACCEPTANCES
Bank-issued commitments to
pay for merchandise sold in the
import/export market.
COMMERCIAL PAPER COMPANIES
Unsecured notes that companies
typically issue to finance current
operations and expenses.
MEDIUM-TERM NOTES
Unsecured corporate debt
obligations that are continuously
offered in a range of maturities
and structures.
THE FUNDS 15
<PAGE>
<PAGE>
[LOGO] PAST PERFORMANCE
No past performance data is available yet for this new fund. Next year's
prospectus will provide the information here.
16 THE FUNDS
<PAGE>
<PAGE>
[LOGO] FEES AND EXPENSES
- --------------------------------------------------------------------------------
The table below describes the fees and expenses you could expect as an investor
in this fund. SHAREHOLDER FEES are one-time expenses charged directly to you.
ANNUAL FUND OPERATING EXPENSES come out of fund assets, and are reflected in the
fund's total return.
FEE TABLE
<TABLE>
<S> <C>
SHAREHOLDER FEES NONE
fees paid directly from your investment
ANNUAL FUND OPERATING EXPENSES
expenses that are deducted from fund assets
Management fees 0.45%
Distribution (12b-1) fees NONE
Other expenses(1),(2) 0.52%
- --------------------------------------------------------------------------------
TOTAL ANNUAL FUND OPERATING EXPENSES(1) 0.97%
</TABLE>
(1) The adviser has agreed to cap the annual fund's operating expenses, although
it may change or drop the cap at any time. With the cap, actual expenses are
projected to be:
<TABLE>
<S> <C>
Management fees 0.45%
Distribution (12b-1) fees NONE
Other expenses 0.43%
- --------------------------------------------------------------------------------
Net annual fund operating expenses 0.88%
</TABLE>
(2) Based on estimated amounts for the current fiscal year.
EXAMPLE
This example shows what you could pay in expenses over time. To help you compare
this fund's expenses with those of other funds, the example uses the same
hypothetical assumptions as other mutual fund prospectuses:
$10,000 original investment
5% annual return
No changes in operating expenses
Reinvestment of all dividends and distributions
<TABLE>
<CAPTION>
1 year 3 years
-------------------------
<S> <C>
$ 99 $ 309
</TABLE>
The figures in the example would be the same whether you sold your shares at the
end of the period or kept them. Because actual return and expenses may be
different, this example is for comparison purposes only.
UNDERSTANDING FUND
EXPENSES
MANAGEMENT FEES
Fee paid to the adviser for
the supervision of the fund's
investment program.
OTHER EXPENSES
Fees paid by the fund for
miscellaneous items such as
transfer agency, custodian,
professional and registration
fees.
THE FUNDS 17
<PAGE>
<PAGE>
The Investment
Adviser
The funds' investment adviser is Burnham Asset Management Corporation, 1325
Avenue of the Americas, New York, NY 10019.
The adviser is responsible for economic research, industry and company analysis,
portfolio recommendations and all investment decisions. In return for these
services, the adviser receives a fee from each fund as described in the table
below.
<TABLE>
<CAPTION>
FUND FEE AS A % OF AVERAGE DAILY NAV
<S> <C>
BURNHAM DOW 30 FOCUSED FUND 0.60%
- --------------------------------------------------------------------------------
BURNHAM FUND 0.60%
- --------------------------------------------------------------------------------
BURNHAM FINANCIAL SERVICES FUND 0.75%
- --------------------------------------------------------------------------------
BURNHAM MONEY MARKET FUND 0.45%
</TABLE>
Total annual operating expenses of these funds are capped (see table below),
which may reduce the adviser's fee. These agreements are temporary and may be
terminated or changed any time.
<TABLE>
<CAPTION>
FUND OPERATING EXPENSE CAP AS A % OF AVERAGE DAILY NAV
CLASS A SHARES CLASS B SHARES
<S> <C> <C>
BURNHAM DOW 30 FOCUSED FUND 1.20% n/a
- --------------------------------------------------------------------------------
BURNHAM FUND 1.30% 2.30%
- --------------------------------------------------------------------------------
BURNHAM FINANCIAL SERVICES FUND 1.60% 2.30%
- --------------------------------------------------------------------------------
BURNHAM MONEY MARKET FUND 0.88% n/a
</TABLE>
YEAR 2000 (Y2K) COMPLIANCE
- --------------------------------------------------------------------------------
The inability of many older computer systems to recognize the year 2000 is
expected to have an impact on world financial markets. The adviser has taken
steps to ensure that its systems are or will be Y2K-compliant, and has also
obtained assurances from its partners and vendors that they are taking similar
steps. However, it is impossible to know in advance how any Y2K problems may
affect the funds' operations (including their ability to calculate share prices
and process redemptions) or how it may affect the performance of portfolio
investments or securities markets in general.
18 THE FUNDS
<PAGE>
<PAGE>
YOUR ACCOUNT
As an investor, you have flexibility in choosing a share class, setting up your
account, making exchanges between funds and withdrawing money from your account.
In this section, you will find a chart that provides a broad overview of the
various options available, followed by more detailed information. It is
important to read the entire section so that you will understand all of the
factors-- including tax liability, sales charges, and transaction volume--that
should influence your investment decisions.
YOUR ACCOUNT 19
<PAGE>
<PAGE>
PURCHASE AND REDEMPTION FLOW CHART
$$$
3 WAYS TO PURCHASE SHARES
DIRECT PURCHASE* PURCHASE* AUTOMATIC
THROUGH DEALER INVESTMENT PROGRAM
CLASS A SHARES
SALES CHARGE AT PURCHASE 4 FUNDS TO CHOOSE FROM:
$$
BURNHAM FUND DOW 30 FOCUSED FUND
FINANCIAL SERVICES FUND MONEY MARKET FUND
2 classes available 1 class available
Class A shares or Class B shares Single class shares
[FRONT-END SALES CHARGE] [BACK-END SALES CHARGE] [NO SALES CHARGE]
CLASS B SHARES
SALES CHARGE AT REDEMPTION
$$$ $$
3 WAYS TO REDEEM SHARES
DIRECT REDEMPTION REDEMPTION AUTOMATIC
THROUGH DEALER CASH WITHDRAWAL PLAN
$$$$$$
*Minimum investment: $1,000 per fund
Minimum continuing investment: $250 per fund
20 YOUR ACCOUNT
<PAGE>
<PAGE>
CHOOSING A SHARE CLASS
- --------------------------------------------------------------------------------
Shares of Burnham Dow 30 Focused Fund and Burnham Money Market Fund
are offered in one class only, with no sales charge. Burnham Dow 30 Focused
Fund, Burnham Fund and Burnham Financial Services Fund pay an annual Rule 12b-1
distribution fee equal to 0.25% of the fund's average net assets. Shares of
Burnham Money Market Fund are not subject to any Rule 12b-1 distribution or
service fees.
Burnham Fund and Burnham Financial Services Fund offer shares in two classes:
<TABLE>
<S> <C>
CLASS A CLASS B
Front-end sales charge decreases with the Contingent deferred sales charge (CDSC)
amount you invest and is included in decreases with the amount of time you
the offering price [see schedule below] hold your shares [see schedule below]
Rule 12b-1 fee of 0.25% annually of Rule 12b-1 fee of 0.75% and service fee of
average NAV 0.25% annually of average NAV
</TABLE>
WHY TWO SHARE CLASSES?
By offering two share classes, a fund
allows you to choose the method
of purchasing shares that is the most
beneficial given the amount of
your purchase, length of time you
expect to hold your shares and
other relevant circumstances.
CLASS A SALES CHARGES
<TABLE>
<CAPTION>
AMOUNT INVESTED SALES CHARGE
% OFFERING PRICE % NAV
<S> <C> <C>
less than $50,000 5.00% 5.26%
$50,000-$99,999 4.50% 4.71%
$100,000-$249,999 4.00% 4.17%
$250,000-$499,999 3.00% 3.09%
$500,000-$999,999 2.00% 2.04%
$1,000,000 and above --* --*
</TABLE>
*PURCHASES OF $1 MILLION OR
MORE (CLASS A SHARES)
The following CDSC will be
imposed on investments over $1
million if shares are sold within
two years of purchase. The charge
is calculated from the NAV at
the time of purchase or sale,
whichever is lower.
CLASS B DEFERRED SALES CHARGE
Maximum purchase $250,000
<TABLE>
<CAPTION>
PURCHASE-TO-SALE PERIOD CDSC
<S> <C>
less than 1 year 5.00%
1-2 years 4.00%
2-4 years 3.00%
4-5 years 2.00%
5-6 years 1.00%
6 years and longer --
</TABLE>
PURCHASE-TO-SALE PERIOD CDSC
Less than 1 year 1.00%
1-2 years 0.50%
Shares not subject to CDSC are redeemed first; remaining shares are redeemed in
the order purchased. No CDSC applies to shares that:
Represent increases in the NAV above the net cost of the original
investment
Were acquired through reinvestment of dividends or distributions
After 8 years, Class B shares automatically convert to Class A.
YOUR ACCOUNT 21
<PAGE>
<PAGE>
SALES CHARGE WAIVERS
Under certain conditions, the following investors can buy Class A shares without
a sales charge:
Shareholders of Burnham Fund who purchased shares directly from the fund
before August 27, 1998
Customers of Burnham Securities Inc. with a cumulative balance of at least
$250,000
Officers, directors, trustees, employees of the adviser the fund's
distributor and any of their affiliated companies, and immediate family
members of any of these people
Employee benefit plans having more than 25 eligible employees or a minimum of
$250,000
Employees of dealers that are members of the National Association of
Securities Dealers, Inc. (NASD), members of their immediate families, and
their employee benefit plans
Certain trust companies, bank trust departments and investment advisers that
invest on behalf of their clients and charge account management fees.
Participants in no-transaction-fee programs of discount brokerages that
maintain an omnibus account with the funds
Individuals investing distributions from tax-deferred savings and retirement
plans
Individuals purchasing shares with the proceeds of a redemption made from
another mutual fund complex within the previous 180 days with proof of
purchase
CLASS B CDSC WAIVERS
CDSC charges will be waived on redemptions of
Class B shares in connection with:
Distributions from certain employee tax-qualified benefit plans
Any shareholder's death or disability
Withdrawals under an automatic withdrawal plan, provided they are less than
10% of your account's original value
WAYS TO REDUCE SALES CHARGES
Investors can reduce or eliminate sales charges on Class A shares under certain
conditions.
COMBINED PURCHASE
Purchases made at the same time by an individual, his or her spouse and any
children under the age of 21 are added together to determine the sales charge
rate.
RIGHT OF ACCUMULATION
If you already hold Class A shares of a fund, the sales charge rate on
additional purchases can be based on your total Class A shares in the fund.
LETTER OF INTENT
This non-binding agreement allows you to purchase Class A shares over a period
of 13 months with the sales charge that would have applied if you had purchased
them all at once.
COMBINATION PRIVILEGE
You can use the combined total of Class A shares of multiple Burnham funds for
the purpose of calculating the sales charge.
PLEASE NOTE:
You must advise your dealer, the transfer agent or the fund if you qualify for a
reduction and/or waiver in sales charges.
CALCULATION OF NET ASSET VALUE
Each fund calculates its net asset value per share (NAV) at the close of regular
trading on the New York Stock Exchange (normally 4:00 p.m. eastern time) on each
business day as defined in the Statement of Additional Information. If the New
York Stock Exchange closes early, the time for calculating the NAV and the
deadline for share transactions will be accelerated to the earlier closing time.
Purchase orders received before the regular close of the New York Stock Exchange
will be executed at the offering price calculated at that day's closing.
DETERMINATION OF SHARE PRICE
The share price of a fund is the total value of its assets less its liabilities,
divided by the total number of outstanding fund shares. Each fund's securities
are valued on the basis of either market quotations or fair value pricing, which
may include the use of pricing services. Because foreign markets and U.S.
markets are open at different times, there may be times when the value of a
fund's securities changes on days when you can't buy or sell fund shares. There
may also be cases when the fund uses fair-value prices for foreign securities,
which may be different from the values used by other funds.
22 YOUR ACCOUNT
<PAGE>
<PAGE>
HOW TO BUY SHARES
<TABLE>
<CAPTION>
MINIMUM PURCHASE AMOUNT
INITIAL PURCHASE SUBSEQUENT PURCHASES
<S> <C> <C>
Individual retirement accounts $50 $50
Automatic investment program $50 $50
All other funds and programs $1,000 $250
</TABLE>
These amounts may be waived or changed at the funds' discretion.
<TABLE>
<CAPTION>
METHOD OF PURCHASE PROCEDURE
<S> <C> <C>
MAIL Open an account Complete and sign the application form. Send a check drawn on a U.S. bank for at
least the minimum amount required, make the check payable to "Burnham Investors
Trust." Send the check and application form to the address below.
Open an IRA Shares of the Trust are available for purchase through Individual Retirement
Accounts (IRAs) and other retirement plans. An IRA application and further
details about IRAs and other retirement plans are available from the distributor
by calling 1-800-874-3863 or your investment professional.
Subsequent purchase Send in a check for the appropriate minimum amount (or more) with your account
name and number. For your convenience, you may use the deposit slip attached to
your quarterly account statements.
FEDERAL Subsequent purchase This option is available to existing open accounts only. New accounts must
FUNDS WIRE complete an application form and forward payment to the address listed below.
Wire address STATE STREET BANK & TRUST CO.
225 FRANKLIN STREET, BOSTON MA
ABA# 011000028
DDA# 99046005
FUND ACCOUNT #
FOR CREDIT TO BURNHAM INVESTORS TRUST (INDICATE CLASS A OR B SHARES)
AUTOMATIC You can make automatic monthly, quarterly or annual purchases (on the 5th or
INVESTMENT 15th day of each month) of $50 or more. To activate the automatic investment
PROGRAM plan, complete an account application notifying the funds. Your investment may
come from your bank account or from your balance in the Burnham Money Market
Fund.You may change the purchase amount or terminate the plan at any time by
writing to the funds.
ELECTRONIC To purchase shares via electronic funds transfer, check this option on your
FUNDS TRANSFER account application form. Your bank must be a member of the ACH system.
DEALER Contact your dealer to set up a new account, purchase fund shares, and make
subsequent investments. Purchase orders that are received by your dealer and are
forwarded by the dealer to the transfer agent before 4:00 p.m. eastern time on
any business day will receive that day's NAV. Your dealer is responsible for
properly forwarding completed orders to the fund transfer agent.
</TABLE>
<TABLE>
<CAPTION>
SEND REGULAR MAIL TO: SEND OVERNIGHT MAIL TO: CALL SHAREHOLDER SERVICE AGENT:
<S> <C> <C>
BURNHAM INVESTORS TRUST BURNHAM INVESTORS TRUST BOSTON FINANCIAL DATA
C/O BFDS, INC. C/O BFDS, INC. SERVICES, INC.
P.O. BOX 8015 66 BROOKS DRIVE TOLL-FREE AT
BOSTON, MA 02266-8015 BRAINTREE, MA 02184-3839 1-800-462-2392
</TABLE>
YOUR ACCOUNT 23
<PAGE>
<PAGE>
HOW TO EXCHANGE AND REDEEM SHARES
- --------------------------------------------------------------------------------
<TABLE>
METHOD PROCEDURE
- --------------------------------------------------------------------------------
<S> <C>
BY MAIL Send a letter of instruction, an endorsed stock power
or share certificates (if you hold certificate
shares) to "Burnham Investors Trust" to the address
below. Please be sure to specify:
the fund
account number
the dollar value or number of shares you wish to
sell
Include all necessary signatures and any additional
documents as well as a signature guarantee if
required (see page 26 for signature guarantee
requirements).
BY TELEPHONE As long as the transaction does not require a
written or signature guarantee (see page 26), you or
your financial professional can sell shares by
calling Burnham Investor Trust at 1-800-462-2392.
Press 1 and follow the automated menu to speak to a
customer service representative. A check will be
mailed to you on the following business day.
AUTHORIZED BROKER/DEALER If you invest through an authorized broker/dealer
OR INVESTMENT PROFESSIONAL or investment professional, they can sell or exchange
shares for you. You may be charged a fee for this.
SYSTEMATIC WITHDRAWAL PLANS If you have a share balance of at least $5,000, you
may elect to have monthly, quarterly or annual
payments of a specified amount ($50 minimum) sent to
you or someone you designate. The funds do not
charge for this service. See "Systematic Withdrawal
Plan" information on page 26.
BY FEDERAL FUNDS WIRE Confirm with Burnham Investors Trust that a wire
redemption privilege, including your bank
designation, is in place on your account. Once this
is established, you may request to sell shares with
Burnham Investors Trust. Proceeds will be wired to
your pre-designated bank account (see "Federal funds
wire" on page 25).
BY EXCHANGE Read the prospectus before making an exchange. Call
Burnham Investors Trust at 1-800-462-2392. Press 1
and follow the automated menu to speak to a customer
service representative to place your exchange.
SEND REGULAR MAIL TO: SEND OVERNIGHT MAIL TO: CALL SHAREHOLDER SERVICE AGENT:
BURNHAM INVESTORS TRUST BURNHAM INVESTORS TRUST BOSTON FINANCIAL DATA
C/O BFDS, INC. C/O BFDS, INC. SERVICES, INC.
P.O. BOX 8015 66 BROOKS DRIVE TOLL-FREE AT
BOSTON, MA 02266-8015 BRAINTREE, MA 02184-3839 1-800-462-2392
</TABLE>
24 YOUR ACCOUNT
<PAGE>
<PAGE>
TRANSACTION POLICIES
- -----------------------------------------------------------------------------
FEDERAL FUNDS WIRES
A federal funds wire transaction must total at least $5,000. Your bank may also
charge a fee to send or receive wires.
CERTIFICATES OF SHARES
The funds do not generally issue certificates of shares, although you may
request them. Certificates are available to shareholders of Burnham Fund Class A
and B shares only. The only way to redeem share certificates is by sending them
to the transfer agent. If you lose a certificate, you will be charged a fee to
replace it.
TELEPHONE TRANSACTIONS
The funds have procedures to verify that your telephone instructions are
genuine. These may include asking for identifying information and recording the
call. As long as the fund and its representatives take reasonable measures to
verify the authenticity of calls, you will be held responsible for any losses
caused by unauthorized telephone orders.
CHECK WRITING FOR BURNHAM MONEY MARKET FUND
You must have a Burnham Money Market Fund account before adding this service.
Call 1-800-462-2392 to request a Shareholder Services application to add the
check writing feature.
Individual checks must be for $250 or more. You may not close a Burnham Money
Market Fund account by writing a check.
THIRD PARTY CHECKS
Third party checks that are payable to an existing shareholder of Burnham
Investors Trust, who is a natural person (not a corporation or partnership) and
endorsed over to Burnham Investors Trust or State Street Bank and Trust Company
will not be accepted.
OTHER POLICIES
Under certain circumstances, the
funds reserve the right to:
Suspend the offering of shares
Reject any exchange or investment order
Change, suspend or revoke
exchange privileges
Suspend the telephone order
privilege without advance
notice to shareholders
Satisfy an order to sell fund
shares with securities
rather than cash, for certain
large orders
Suspend or postpone your
right to sell fund shares
on days when trading on the
New York Stock Exchange is
restricted, or as otherwise
permitted by SEC
Change their investment minimums
or other requirements
for buying or selling, or waive
minimums and requirements
for certain investors
REGULAR INVESTING AND DOLLAR-COST AVERAGING
Dollar-cost averaging is the practice of making regular investments
over time. When share prices are high, your investment buys
fewer shares. When the share price is low, your investment buys more shares.
This generally lowers the average price per share that you pay over time.
Dollar-cost averaging cannot guarantee you a profit or prevent losses
in a declining market.
YOUR ACCOUNT 25
<PAGE>
<PAGE>
TRANSACTION POLICIES CONTINUED
- --------------------------------------------------------------------------------
WHAT IS A SIGNATURE
GUARANTEE?
A signature guarantee ensures
that your signature is authentic.
Most banks and financial
institutions can provide you
with one. Some charge a fee,
but it is usually waived if you
are a customer of the financial
institution.
A notary public cannot
provide a signature guarantee.
You will need a signature
guarantee on a written request
to redeem shares in certain
cases, including:
When selling more than
$25,000 worth of shares
When you want your check
to be payable to someone
other than the owner of
record, or sent somewhere
other than the address of
record
When you want the
proceeds sent by wire or
electronic transfer to a
bank account you have not
designated in advance
REDEEMING SHARES
You may redeem your shares in the fund at any time. The proceeds are generally
sent out within three business days after your order is executed. There are two
cases in which sale proceeds may be delayed beyond the normal three business
days:
In unusual circumstances where the law allows additional time if needed
If a check you wrote to buy shares hasn't cleared by the time you sell the
shares
If you think you will need to redeem shares soon after buying them, you can
avoid the check clearing time (which may be up to 15 days) by investing by wire
or certified check.
EXCHANGE PRIVILEGE
Exchange of shares have the same tax consequences as redemptions. The fund's
general policy is that sales charges on investments entering the fund complex
should be applied only once. Therefore, you may exchange shares freely between
funds within the same share class. Each fund reserves the right to modify this
policy in the future.
Exchanges must meet the minimum initial investment requirements of the fund.
THE FUNDS MAY CANCEL THE EXCHANGE PRIVILEGE OF ANY PERSON THAT, IN THE OPINION
OF THE FUNDS, IS USING MARKET TIMING STRATEGIES OR MAKING MORE THAN FOUR
EXCHANGES PER OWNER OR CONTROLLING PERSON PER CALENDAR YEAR.
ACCOUNT BALANCE BELOW MINIMUM AMOUNTS
The funds reserve the right to close your account if your balance falls below
the minimum initial investment amount of $1,000. Your fund will notify you and
allow you 60 days to bring the account balance back up to the minimum level.
This does not apply to reduced balances caused by market losses or accounts
established that do not require a minimum investment restriction.
REINSTATEMENT PRIVILEGE
You may reinvest your proceeds from a redemption in shares of the same class.
The proceeds will be credited at NAV up to 90 days after the redemption of
shares.
SYSTEMATIC WITHDRAWAL PLAN
A systematic withdrawal plan (SWP) is available for shareholders who maintain
a share balance of at least $5,000 in fund shares, who wish to receive a
specific amount of cash in amounts not less than $50 either monthly,
quarterly, or annually. You may subscribe to this service by contacting your
account executive, or by contacting the distributor at (800) 874-FUND for a
Shareholder Services application form.
The fund's transfer agent will redeem a sufficient number of your shares, held
in book-entry form, at the net asset value (for Class A shares) or less the
appropriate CDSC (for Class B shares) at the close of business of the NYSE on
or about the 20th day of each payment month. A check will mailed to you no
later than three business days following the date the shares are redeemed.
26 YOUR ACCOUNT
<PAGE>
<PAGE>
TAX CONSIDERATIONS AND DISTRIBUTIONS
- --------------------------------------------------------------------------------
Each fund pays dividend and distributions, as described in the table below.
Unless you notify the fund otherwise, your income and capital gains
distributions from a fund will reinvested in that fund. However, if you prefer
you may:
Receive all distributions in cash
Reinvest capital gains distributions, but receive your income
distributions in cash
You may indicate your distribution choice on your application form upon
purchase. Your tax liability is the same in both cases.
<TABLE>
<CAPTION>
TYPE OF DISTRIBUTION DECLARED & PAID FEDERAL TAX STATUS
<S> <C> <C>
DIVIDENDS FROM
NET INVESTMENT INCOME ordinary income
Burnham Fund quarterly
Burnham Financial Services annually
Burnham Dow 30 Focused annually
Burnham Money Market declared daily
paid monthly
- --------------------------------------------------------------------------------
SHORT-TERM CAPITAL GAINS
(all funds) annually ordinary income
- --------------------------------------------------------------------------------
LONG-TERM CAPITAL GAINS
(all funds) annually capital gain
- --------------------------------------------------------------------------------
</TABLE>
Distributions from Burnham Fund, Burnham Dow 30 Focused Fund and Burnham
Financial Services Fund are expected to be primarily capital gains.
Distributions from Burnham Money Market Fund will be primarily ordinary income.
The funds issue Form 1099 tax information statements recording all distributions
and redemptions for the preceding year. These forms are mailed to shareholders
and to the Internal Revenue Service each year by January 31. Any shareholder who
does not supply a valid taxpayer identification number to the funds may be
subject to federal backup withholding tax.
It is a taxable event whenever you redeem or exchange shares. Depending on their
purchase and redemption prices and how long you held them, you may have a short-
or long term capital gain (or loss).
You should consult your tax adviser about your own particular tax situation.
Distributions are taxable in the year you receive them. In some cases,
distributions you receive in January are taxable as if they had been paid the
previous year.
BUYING SHARES
BEFORE A DISTRIBUTION
The money a fund earns, either
as income or as capital gains, is
reflected in its share price until
the fund makes a distribution.
At that time, the amount of the
distribution is deducted from
the share price and is either
reinvested in additional shares or
paid to shareholders in cash.
If you buy fund shares just before
a distribution, you will get some
of your investment back in the
form of a taxable distribution.
You can avoid this by waiting to
invest until after the fund makes
its distribution.
Investments in tax-deferred
accounts are not affected by the
timing of distribution payments
because there are no tax
consequences with such accounts.
BACKUP WITHHOLDING
When you fill out your application
form, be sure to provide
your Social Security
number or taxpayer ID number. Otherwise,
the IRS will require each fund
to withhold 31% of all money
you receive from the fund.
YOUR ACCOUNT 27
<PAGE>
<PAGE>
DOW JONES DISCLAIMER
- --------------------------------------------------------------------------------
RETIREMENT PLANS
The funds offer a number
of tax-deferred plans for
retirement savings:
TRADITIONAL IRAS allow
money to grow tax-deferred
until you take it out at
retirement. Contributions may be
deductible for some investors.
ROTH IRAS also offer tax-free
growth. Contributions are
taxable, but withdrawals
in retirement are tax-free for
investors who meet certain
requirements.
SEP-IRA and other types of
plans are also available. Consult
your tax professional to determine
which type of plan may
be beneficial to you.
"Dow Jones'sm'," "Dow Jones Industrial Average'sm'" and "DJIA'sm'" and "Dow
30'sm'" are service marks of Dow Jones & Company, Inc. Dow Jones has no
relationship to Burnham Dow 30'sm' Focused Fund or its distributor, other than
the licensing of the Dow Jones Industrial Average (DJIA) and its service marks
to the distributor to use in connection with the fund.
DOW JONES DOES NOT:
Sponsor, sell or promote the fund.
Recommend that any person invest in the fund or any other securities.
Have any responsibility or liability for or make any decisions about the
timing, amount or pricing of fund share offerings or redemptions.
Have any responsibility or liability for the administration, management or
marketing of the fund.
Consider the needs of the fund or its shareholders in determining,
composing or calculating the DJIA or have any obligation to do so.
DOW JONES WILL NOT HAVE ANY LIABILITY IN CONNECTION WITH THE FUND.
Specifically,
Dow Jones does not make any warrants, express or implied, and Dow Jones
disclaims any warranty about:
The results to be obtained by the fund, its shareholders or any other
person in connection with the use of the DJIA and the data included in
the DJIA;
The accuracy or completeness of the DJIA and its data;
The merchantability and the fitness for a particular purpose or use of
the DJIA and its data.
Dow Jones will have no liability for any errors, omissions or interruptions
in the DJIA or its data.
Under no circumstances will Dow Jones be liable for any lost profits or
indirect, punitive, special or consequential damages or losses, even if Dow
Jones knows that they might occur.
The licensing agreement between the fund's distributor and Dow Jones is solely
for their benefit and not for the benefit of the fund, its shareholders or any
other third parties.
28 YOUR ACCOUNT
<PAGE>
<PAGE>
FINANCIAL HIGHLIGHTS
THE FINANCIAL HIGHLIGHTS TABLE IS INTENDED TO HELP YOU UNDERSTAND BURNHAM FUND'S
FINANCIAL PERFORMANCE OVER THE PAST FIVE YEARS. CERTAIN INFORMATION REFLECTS
FINANCIAL RESULTS FOR A SINGLE FUND SHARE. THE TOTAL RETURNS IN THE TABLE
REPRESENT THE RATE THAT AN INVESTOR WOULD HAVE EARNED (OR LOST) ON AN INVESTMENT
IN THE FUND, ASSUMING REINVESTMENT OF ALL DIVIDENDS AND DISTRIBUTIONS. THIS
INFORMATION HAS BEEN AUDITED BY PRICEWATERHOUSECOOPERS LLP, WHOSE REPORT, ALONG
WITH THE FUND'S FINANCIAL STATEMENT, IS INCLUDED IN THE ANNUAL REPORT, WHICH IS
AVAILABLE UPON REQUEST.
BURNHAM FUND FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
Class A Shares Class B Shares
1998 1997 1996 1995 1994 1998 1997 1996 1995 1994
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year $30.04 $25.65 $23.19 $19.88 $21.86 $30.75 $26.31 $23.45 $19.94 $21.84
--------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS
Net investment income 0.25 0.45 0.51 0.71 0.75 (0.03) 0.13 0.21 0.41 0.49
Net gains or losses on securities
(both realized and unrealized) 5.97 5.54 3.36 3.91 (1.15) 6.12 5.75 3.69 4.10 (1.04)
--------------------------------------------------------------------------------------
TOTAL FROM INVESTMENT OPERATIONS 6.22 5.99 3.87 4.62 (0.40) 6.15 5.88 3.90 4.51 (0.55)
LESS DISTRIBUTIONS
Dividends (from not investment income) (0.32) (0.44) (0.55) (0.75) (0.87) (0.06) (0.28) (0.18) (0.44) (0.64)
Distributions from capital gains (from
securities and options transactions) (1.63) (1.16) (0.86) (0.56) (0.71) (1.63) (1.16) (0.86) (0.56) (0.71)
--------------------------------------------------------------------------------------
Total distributions (1.95) (1.60) (1.41) (1.31) (1.58) (1.69) (1.44) (1.04) (1.00) (1.35)
--------------------------------------------------------------------------------------
NET ASSET VALUE, END OF YEAR $34.31 $30.04 $25.65 $23.19 $19.88 $35.21 $30.75 $26.31 $23.45 $19.94
--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------
Total return 22.08% 24.74% 17.60% 24.45% (1.77%) 21.16% 23.60% 17.34% 23.54% (2.52%)
--------------------------------------------------------------------------------------
RATIO/SUPPLEMENTAL DATA
Net assets (in $millions), end of year 156.7 136.4 117.4 112.0 101.8 2.4 1.6 1.0 0.6 0.3
--------------------------------------------------------------------------------------
Ratio of net expenses to
average net assets(1) 1.3%* 1.1% 1.3% 1.5% 1.5% 2.1% 2.0% 2.1% 2.2% 2.3%
--------------------------------------------------------------------------------------
Ratio of net Income to 0.8% 1.6% 2.1% 3.3% 3.7% 0.0% 0.7% 1.3% 2.5% 2.9%
average net assets --------------------------------------------------------------------------------------
Portfolio turnover rate 54.7% 59.4% 61.5% 78.3% 87.9% 54.7% 59.4% 61.5% 78.3% 87.9%
--------------------------------------------------------------------------------------
</TABLE>
(1) For the year ended December 31, 1998, the investment adviser reimbursed
Class A and Class B shares for expenses in excess of the expense
limitation. The ratios of expenses to average net assets would have
been 1.3% and 2.1% respectively, had the investment adviser not agreed
to reimburse expenses.
FINANCIAL HIGHLIGHTS 29
<PAGE>
<PAGE>
WHERE TO GET
MORE
INFORMATION
ANNUAL AND QUARTERLY REPORTS
- --------------------------------------------------------------------------------
These include commentary from the fund manager on the market conditions and
investment strategies that significantly affected the fund's performance,
detailed performance data, a complete inventory of the fund's securities, and a
report from the fund's auditor.
STATEMENT OF ADDITIONAL INFORMATION (SAI)
- --------------------------------------------------------------------------------
The SAI contains more detailed disclosure on features and policies of the funds.
A current SAI has been filed with the Securities and Exchange Commission and is
incorporated by reference into this document (that is, it is legally a part of
this prospectus).
HOW TO CONTACT US
You can obtain these documents
free of charge by contacting your dealer or:
[LOGO] Burnham Securities Inc.
1325 Avenue of the Americas, 26th Floor
New York, NY 10019
1-800-874-FUND
www.burnhamfunds.com
[email protected]
These documents are also available from the SEC:
SECURITIES AND EXCHANGE COMMISSION
450 Fifth Street NW
Washington, DC 20549-6009
1-800-SEC-0330
www.sec.gov
Note: The SEC requires a duplicating fee for paper copies.
SEC file number: 811-994
Burnham Asset Management was
founded in 1989 and today, together
with Burnham Securities, Inc.,
manages approximately $3 billion in
assets for investors. The Burnham
Fund was created in 1975 and has
been guided by the same investment
team since inception.
The Burnham family of funds has
recently expanded to offer greater
flexibility to investors. All the funds
share Burnham's fundamental philos-
ophy of prudent investment and
risk management through all phases
of the economic cycle.
STATEMENT OF DIFFERENCES
------------------------
The service mark symbol shall be expressed as............................ 'sm'
